Foreign Investment Brings Cambodia Growth, New Issues

A train prepares to start during the official recommencement of commercial train services on a rehabilitated rail corridor in Phnom Penh October 22, 2010.

Cambodian officials say the country's economic growth rate is set to exceed seven percent this year. According to financial analysts even if the global economy slows, Cambodia is well prepared to deal with it, partly because of strong foreign investment. But the billions of dollars flowing into the country are also raising concerns about the political and social impact from massive development projects.

Cambodia has posted strong economic growth in the two years since the 2008 global financial crisis. Foreign investment, a growing tourism industry and a strong agricultural sector have been key to that growth.

The country's garment and textiles sector is also doing well, with exports set to rise by 40 percent this year.

"The Cambodian economy is probably in the best shape it has ever been in - absent is what is going on the rest of the world," said Stephen Higgins, chief executive officer for ANZ Royal Bank in Phnom Penh. "The economic growth this year we think will be in the range of seven to eight percent, and the normal global environment we would expect probably eight to 10 percent in the next few years."

But Higgins says inflation must be kept under control, especially with regard to rising food prices.

Despite economic uncertainty in Europe and the United States, the Asian Development Bank (ADB) estimated growth this year at 6.8 percent and only expects the rate to decrease slightly next year.

Analysts say foreign investors from Japan are seeking alternatives to China and Thailand. They are joining long standing regional investors such as Vietnam and South Korea.

But China remains the country's top investor. Chinese state media report that investors have poured in about $5.5 billion in the first seven months of the year.

Among the investments is a luxury property development project worth $3 billion. China has also provided money for hydropower and road construction. And two of China's leading banks, the Industrial and Commercial Bank of China and the Bank of China, opened branches in Cambodia this year.

ADB senior economist Peter Brimble says while funds from China are welcome, Chinese aid can be restrictive.

"Chinese aid is extremely tied; [there is] no bidding. It's quite likely - especially if it's a loan rather than a grant - you may actually be paying more for what you are getting just because the Chinese don't believe in competitive bidding. I think the government knows that."

Critics say China's economic influence is linked to its political concerns. They point to an incident in 2009 when Cambodia deported 20 Muslim ethnic Uighurs who sought asylum after fleeing violence in China. Soon after their departure, a senior Chinese official arrived in Cambodia to sign 14 trade deals worth $850 million.

David Carter, president of the Australian Business Association of Cambodia, says Cambodia has welcomed investment from China.

"Certainly it has a big influence on the place," said Carter. "Bridges and roads are being built. So there's a feeling that a lot of Chinese money around the place, but I think most people are aware it will come with obligations attached. So it's good, but you have to pay your bills back at some time."

The development projects funded by those investments can have a dramatic impact on one of South East Asia's poorest nations. While officials have welcomed investments in upgrading Cambodia's infrastructure, there have also been thousands of evictions to make way for new projects. In 2010, rights groups estimate 30,000 people were forced from their homes by mining, agriculture and hydropower projects.

The Housing Rights Task Force, a rights group that has been critical of government resettlement policies, says up to 150,000 people may be evicted in the coming years. They say at least 80,000 evictions could occur in the capital, Phnom Penh.

Hang Chayya, director of the Khmer Institute for Democracy, says foreign investors must respect human rights in order to maintain long term relationships in Cambodia.

"Any bilateral relationship with China has to be done on one that respects human rights and democracy in the country," said Chayya. "And this is what is not happening in the government taking the option of dealing with China."

Cambodia's economic performance will be highlighted in 2012, when Phnom Penh hosts the annual meetings of the regional Association of South East Asian Nations (ASEAN).

Analysts say Cambodia's economic future increasingly lies with the fortunes of its close neighbors Thailand, Vietnam and Laos, and its distant neighbor to the north, China.
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Cambodia: a country with its eye on the past

Clover Stroud revels in the colour, energy and optimism of modern Cambodia, but also discovers a country where few people remain unaffected by its recent history.

Mekong River fishermen are struggling to survive by fishing for food in everyday in modern Cambodia

Children are playing basketball in the water. In a caged court on a lake, they dance with the ball, slamming it into the wire walls encasing them. A boat bobs alongside, its driver shouting to the children. They thrust hands out for cartons of mango juice which he exchanges for sweaty coins.

I've never seen a basketball court on water, but this is Cambodia and it's one of many things in the country that opens my eyes. The court is on Lake Tonle Sap, south of Siem Reap, home to catfish, freshwater dolphins, lots of crocodiles and towns of stateless Vietnamese, who arrived in 1979 with the soldiers.

Today 1.4 million live in floating villages, another four million on the banks. The villages, like much in Cambodia, are testimony to the ingenuity of people fighting for survival. Houses built on bamboo stilts skim the water, faded tarpaulins cover verandas slung with hyacinth-rope hammocks. Women tend steaming pots, lids rattling, over stoves. Children, who can swim before they walk, leave for school in punts.

The men fish, or squat, smoking, watching for a water rat to kill with a slingshot. A thick, inescapable smell of concentrated fish laces the air, the main ingredient of teuk trei, or fish sauce, which I'll take home but fail to reproduce the scented, tangy flavours of sumlar ngam ngouw (chicken soup) and other dishes I'd eaten at the Abacus Restaurant on Pum Khun Street in Siem Reap.

Girls with hair the colour of plums wave at me, even though they know I won't buy their bags of charcoal. Still, they pull their boat towards mine, handing me slices of mango, but disappearing, beyond reach, as I try pass them some money.

The people are poor, certainly, but there's a vibrancy to what appears to be a thriving community, with a Roman Catholic church and Buddhist temple beside each other, a busy supermarket and cafés selling frog fried with garlic and rat stewed with ginger.

The floating villages embody the opposites and incongruity of Cambodia. It's a place of fragrance and beauty, of colourful temples and magical music; a place where I experienced only generosity and kindness from everyone I met. But there's sadness too, of course, because it's impossible to forget 1975, when the Khmer Rouge perpetrated genocide, and banned money, school, hospitals, law, religion and families.

As a visitor, knowing how to deal with Cambodia's past is difficult. I wasn't sure whether to visit Choeung Ek, the killing fields museum, or Tuol Sleng S-21, where thousands were tortured. But so many conversations I had with temple guides, porters and waitresses referred to the past that I realised it was something one had to acknowledge and try to understand.

On a baking afternoon I went to the killing fields and the school, and the piles of skulls, buried bones and hundreds of photographs of people on their way to death were as dreadful and harrowing as you'd expect. Afterwards, I realised these were necessary visits: in this beautiful and confusing country, no one remains unaffected by the past.

But there's an optimism too, in the sense of a country getting to grips with becoming the place it knew it could be. Phnom Penh and Siem Reap are very different, but both embody this spirit. The capital is a tangle of broad avenues and teeming markets, where the memory of the country's past as a French colony is evident in the numerous grand colonial buildings, peering incongruously from behind lines of motorbikes, many piled with entire families, or tuk-tuks racing down the street like children's toys.

By evening the Mekong dominates the city, as boats lit by lanterns bob past cafés spilling across the banks, places where families gather, teenagers on bikes sell baguettes and an older generation play chess, their grandchildren playing excitedly around their feet.

DID YOU KNOW?
Such is Angkor Wat’s significance in Cambodia that it features in white at the centre of the country’s flag
 
In the tropical gardens of the Royal Palace, beneath the glimmering towers of the Silver Pagoda, is a life-size gold Buddha studded with diamonds. It's jaw-dropping, but I preferred the sense of the messy, living spirit of the city at the hilltop temples of Wat Phnom, where Cambodians come to pray for luck in everything from love and life to job interviews and exams. Offerings of grilled meat and eggs surrounded by grubby stacks of money pile the altars. Hundreds of Buddhas cover the temple floor, glittering with coloured lights, and stacks of plastic plates wait for offerings. Outside, girls sell cages of birds, which are released for good luck and fly over the city that roars beneath the hill, even after the sun has gone down.

Siem Reap is more sedate, around 190 miles to the north-west, a necessary stop en route to Angkor Wat. Laid out on a grid, it feels like a provincial town, but with a proliferation of new restaurants and bars. Of course you should go to Angkor Wat, because nothing about the temples, rising from the jungle, disappoints, except, perhaps, for the number of visitors. The scale is staggering, and there's a palpable sense of excitement in watching the sun break over the temples.

Stranger, and less visited, are the temples of Beng Mealea, about 35 miles east of the city. These temples are surrounded by a huge moat, the jungle twisting through the remaining stones, so that you clamber along wooden walkways, with a sense of the strange, massive jungle all around.

I was lucky too, as I was travelling with Cox & Kings, which organises safari-style camps as accommodation. Arriving by night, after a long journey down potted roads, I fell asleep to the chirp of the jungle and woke to the screech of swallows outside my tent. As the light thickened, I could make out a massive step pyramid through the trees, reminding me of Mayan temples I'd seen in Mexico.

There were no other visitors, just monkeys and red kite to accompany me as I scrambled around the ruins. I hadn't expected a safari camp near Siem Reap, but this is Cambodia, where children play basketball on water, and where almost everything surprises.

WHAT TO AVOID

Crossing Phnom Penh on foot is exhausting and best avoided. Instead take a moto (motorbike taxi) or cyclo (the distinctive Cambodian cycle rickshaw), which can be picked up on the pavement.

For an English-speaking moto driver, try the ones who wait around the Foreign Correspondents’ Club (00855 760280; Pokambor Street; www.fcccambodia.com). For the best cyclos, try the Cyclo Centre Phnom Penh (9D 158 Street; 991178).

Local delicacies in the market include spider and beetles, and sadly there are places to try snake and turtle all over Phnom Penh; avoid illegally hunted animals such as pangolin and bear.

In the cities it’s best not to eat with your fingers. Locals will not object if you use your right hand, but not your left, to pick up a piece of meat such as a chicken leg.

It’s considered rude to use a toothpick without covering your mouth with one hand.

GETTING THERE
There are no direct flights to Cambodia. Thai Airways (020 7491 7953; www.thaiairways.co.uk) offers flights from Heathrow to Phnom Penh, changing in Bangkok, from £700 return.

PACKAGES

Cox & Kings (020 7873 5000; www.coxandkings.co.uk) organises eight-night tours of Cambodia from £2,845 per person, including private transfers, guides and excursions, a return economy flight and two nights at Raffles Le Royal Phnom Penh (Landmark Room), three nights at Raffles Grand Hotel d’Angkor (Landmark Room) and three nights at the Temple Safari.

Seasons (01244 202000; www.seasons.co.uk) offers a seven-night journey through Cambodia from £2,570 per person, including flights, b & b, transfers and excursions, with three nights in Siem Reap, two in Phnom Penh and two at an eco-resort at Koh Trat, in the south-west of the country.

THE INSIDE TRACK

The killing fields at Choeung Ek are eight miles south of Phnom Penh, on Monireth Avenue (daily 7am-5pm; £3). The entrance to the Toul Sleng Genocide Museum in Phnom Penh (daily 7.30am-5.30pm; £3) is off Street 113.

Angkor Wat is essential, but other temples are often quieter and as rewarding: 12th-century Ta Som, once a hiding place for the Khmer, is known for the two massive Bodhisattva heads in the roots of a kapok tree. Neck Pean, or “entwined serpents”, has a series of pools linked by walkways, thought to represent a mythical Himalayan lake.

Chong Kneas is the closest floating village on Lake Tonle Sap to Siem Reap, where you’ll find fishermen, boat-makers and crocodile farmers at work.

For a stilted village, visit Kompong Khleang, especially in the early morning, when the fishermen and schoolchildren leave the village. Boats (£30 for 2-10 people) can be taken from the port at Chong Kneas.
Visitors cannot drive cars in Siem Reap, but you can visit Angkor Wat by tour bus from the bigger hotels. Better still, take a guide. Friendly and punctual, English-speaking Kim San organises single or multi-day trips of the area, including Angkor Wat, Beng Mealea and the floating villages (00855 12 448456; www.angkor-guide.com; from £45 for day tour for 2-4 people).

THE BEST HOTELS

OK £Clean, dormitory beds or basic rooms in one of the friendliest hotels in Phnom Penh, just off the Mekong riverfront. Basic bar and restaurant, and the owner will help organise visa extensions (986534; hello0325@hotmail.com; from £1).

Mahogany ££Traditional Siem Reap guesthouse and one of the oldest of its type in the city. The friendly proprietor, known as Mr Prune, is an encyclopedic source of knowledge (963417; 593 Wat Bo Street, Siem Reap; from £14).

Raffles Hotel Le Royal £££
The grandest hotel in the capital, situated in a colonial building dating from 1929, with a big pool. The Elephant Bar is a good place to go for happy-hour cocktails (5pm-7pm) for Cambodian glamour (981888; www.phnompenhraffles.com; from £135).

THE BEST RESTAURANTS

Khmer Surin Restaurant ££Excellent stir-fries, including morning glory and shrimp, and a lively, student crowd. Afterwards nip next door to the massage rooms for the best foot massage in the city (No 9, Street 57, off Sihanouk Blvd 12302 Phnom Penh; 363050).

Restaurant Bopha £££On the banks of the Mekong, this terrace restaurant serves excellent Khmer food, including delicious chicken with banana flower soup and water buffalo, which is like a leaner version of beef; traditional Apsara dancing most evenings, 7pm-9pm (Sisowat Quay, by Siem Reap ferry; bopha-phnompenh.com; 427209).

Foreign Correspondents’ Club £££ In the old French governor’s mansion, this is a Cambodian institution, with a terrace overlooking Pokambor Avenue by the Siem Reap river. Stick with the Khmer dishes, including excellent fish amok (Pokambor Street; www.fcccambodia.com; 760280).

FURTHER READING

The Gate by Francois Bizot: French ethnologist Bizot was captured and imprisoned for three months in the jungle by the Khmer Rouge. He befriended his captor, Comrade Duch, perpetrator of some of the most horrific atrocities in Tuol Sleng.

Rivers of Time by Jon Swain: famous as the journalist in David Puttnam’s film The Killing Fields, Swain lived in Cambodia from 1970 to 1975, during the arrival of the Khmer Rouge in Phnom Penh.

First They Killed My Father: a Daughter of Cambodia Remembers by Loung Ung: Ung was five when the Khmer Rouge arrived, born to an educated family who were all in grave danger, but who survived by posing as illiterate peasants. Ung escaped to Thailand, but not before her parents and two of her six siblings were killed.
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Scores die in worst Mekong flooding since 2000

PHNOM PENH (Reuters) - At least 150 people in Cambodia and southern Vietnam have died in the worst flooding along the Mekong River in 11 years after heavy rain swamped homes, washed away bridges and forced thousands of people to evacuate.

Worse could be in store if Typhoon Nesat, which killed at least 39 people in China this week and plowed into northern Vietnam on Friday, dumps rain deep enough inland to further swell the Mekong.

Flooding across the fertile Mekong Delta helped drive rice prices to a three-year high in Vietnam this week, traders said, which will add to inflation problems. The delta produces more than half of Vietnam's rice and 90 percent of its exportable grain.

In Cambodia, 141 people have died since August 13 due to Mekong flooding and flash floods, the Cambodian National Disaster Management Committee said.

"Now, more than 200,000 hectares (494,200 acres) of our rice paddies are under water but we don't yet know the full extent of the damage," said Keo Vy, deputy information director at the National Disaster Management Committee.

Cambodia is a minor rice exporter, but Vietnam is the world's second-biggest exporter behind Thailand.

In 2000, the worst flooding in decades killed more than 480 people across the Delta region. The following year, more than 300 people died when the Mekong, which flows 4,350 km (2,700 miles) from the glaciers of Tibet to the rice-rich Delta of southern Vietnam, overflowed its banks.

Some 150,000 families had been affected by the flooding in Cambodia this year and another 15,000 evacuated to higher ground, said Men Neary Sopheak, deputy secretary general of Cambodia's Red Cross.

Down river in Vietnam, at least nine people have died since seasonal floods arrived in the Delta in August, government and provincial disaster reports said. Floods had inundated nearly 3,800 houses and nearly 700 people were evacuated in An Giang province and the city of Can Tho.

Dykes and bridges were washed away in places and roads submerged by the muddy deluge. Production of shrimp and fish had been affected in parts of the Delta.

PEAK OF FLOODING NEAR?

Flooding is forecast to peak in Vietnam in early October. The waters had already peaked in Cambodia and were receding there slowly, the Vietnamese government said on Friday.

Water had reached 4.76 metres (15 ft 7 in) early on Friday at Vietnam's Tan Chau gauging station, 0.26 meter (10 in) above Alarm Level Three, the most dangerous flood condition at which inundation is widespread and dykes are in jeopardy.

It was forecast to peak at 4.9 metres (16 ft) by Sunday, the government said. Water 5 metres deep can submerge one-storey houses, which are common in the Delta in southern Vietnam.

Deputy Prime Minister Hoang Trung Hai urged the provincial authorities to evacuate people from dangerous areas, speed up the rice harvest and close more schools to prevent deaths.

Around 5,000 hectares (12,355 acres) of the Delta's third rice crop have been inundated as floods broke through dyke sections in the provinces of Dong Thap and An Giang, and another 90,000 hectares (22,240 acres) were under threat.

The region has planted nearly 600,000 hectares (1.58 million acres) for the current crop, which is mainly for domestic consumption, and only 5 percent has been harvested, the agriculture ministry said.

In Thailand, the Department of Disaster Prevention and Mitigation said 180 people had died in flooding since mid-July caused by tropical storm Nock-Ten and seasonal monsoons.

Two million people in 23 provinces have been affected, with 2.4 million acres of farmland under water. Officials say rice has been harvested early in some areas, which may cut yields.

Flooding was reported in the night bazaar in the northern town of Chiang Mai, popular with tourists, and flash floods and landslides were reported in areas around town due to the high level of the Ping river, officials said.

(Additional reporting by Ho Binh Minh in Hanoi and Jutarat Skulpichetrat in Bangkok; Writing by John Ruwitch; Editing by Alan Raybould and Sanjeev Miglani)

 

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Thailand mulls asking Cambodia to transfer two detained Thai activists

BANGKOK, Sept 30 - Thailand is considering asking Cambodia to transfer two Thai activists detained in the neighbouring country for espionage to serve out their jail terms in their own homeland, a government spokesperson said on Friday.

Thai government spokeswoman Thitima Chaisaeng made the statement following a report in Phnom Penh Post about possible prisoner swap between Thailand and Cambodia.

Ms Thitima said the government is now mulling over asking Cambodia to transfer Veera Somkwamkid, coordinator of Thailand's Patriots Network, and his secretary Ratree Pipattanapaiboon, now in a Cambodian jail on spying charges and illegal entry.

She said the idea was floated during the recent visit of Thai Defence Minister Gen Yutthasak Sasiprapa to the neighbouring country and that the law on the transfer of prisoners has been enforced since 2009 but on condition that the prisoners must serve out one-third of their jail terms.

For royal pardon, the prisoners must serve two-thirds of their assigned jail term, so it depends on the Cambodian government as to how it will proceed with the Thai request, the spokesperson said.

Ms Thitima added there is also a possibility that the prisoners' jail term will be reduced on Cambodian special occasions to one-third before being transferred to Thailand.

"The government wants to secure the release of Mr Veera and Ms Ratree as soon as possible," she stated.

The Phnom Penh Post earlier quoted Ms Thitima as saying prisoner exchanges between Phnom Penh and Bangkok could take place “very soon” and that the Thai Ministry of Justice had begun examining in detail how to circumvent existing legal impediments.

A Cambodian court on Feb 1 ruled that the pair were guilty of espionage, illegal entry, and trespassing in a military zone. Mr Veera was sentenced to an eight-year jail term while Ms Ratree was handed a six-year jail term. Their petitions seeking a royal pardon were rejected as the Cambodian government asserted the two must serve two-thirds of their jail terms first. (MCOT online news) Read more!

Engineers Without Borders helps Cambodia

By Luke Shaffer



Fresno State students give classes at the National Technical
Training Institute in Cambodia. Cambodia students learn the
basic function of wind turbines. Courtesy of Jameson Schwab



Twelve-to-16 Fresno State engineering students annually travel oversees to support community-driven development programs and help poor communities become more industrialized.

“Engineers Without Borders really opened my eyes to the world and gave me an experience that I will never forget,” Fresno State student Jameson Schwab said.

EWB-USA sends a team of students from Fresno State every year to Cambodia to construct a project. This year in December, 10 students will be sent to Phnom Penh, the capital of Cambodia.

“Our role for this semester and project is to design, prototype, build and test a vertical access wind turbine,” Carson Schafer, Fresno State mechanical engineer and leading mechanical officer for EWB-USA, said. “We will then teach the Cambodian students [at the National Technical Training Institute] how to use it and the basic functions behind the concept of the wind turbine.”

Fresno State engineering student and EWB-USA President Daisy Manivong hopes that in addition to helping Cambodian villages improve their lifestyle by providing electricity, the engineering program will continue to thrive and improve other communities.

Manivong added that she perceives EWB-USA as a club that opens up opportunities to all Fresno State students.

“Since my freshman year I have been involved in the organization and my goal is to continually keep the club going because it benefits not only engineer students, but other majors as well,” Manivong said.

In December EWB-USA will be sending a team of students comprised of mechanical, electrical and civil engineers who will travel to Cambodia to construct a wind turbine.

“I hope we end up with a good team that goes to Cambodia and does the project well,” Manivong added.

“Fresno State students will benefit from this program by not only learning,” Manivong said. “They will be able to take [that knowledge] to their fields.” Manivong encourages all students to get involved in EWB-USA.

Fresno State professor Michael Jenkins said Associated Students, Inc., contributes from $10,000 to $15,000 through the Student Instructionally Related Activities program to EWB-USA.

“Our main challenge is funding and getting support from sponsors. But we’ve been helped by IRA a lot,” added Manivong.

Another challenge for EWB-USA is language barriers. This challenge is through training, language and cultural classes.

“The impact we made as a group in Cambodia will always be something I can be proud of,” Schwab said “Knowing we helped other students and showed them new things is something this organization has done for the past few years and will keep doing for years to come.”
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